Understanding the Utah Solar Tax Credit
Updated: Mar 19, 2019
The Utah solar tax credit reduces the cost of installing a photovoltaic system, which reduces the time it takes to reach the break-even point. Not all states offer a financial incentive for going solar – actually, most do not – so Utah homeowners are fortunate that this perk hasn’t gone the way of the dodo.
But, the state-level tax credit in Utah is destined for extinction. To save the most on your photovoltaic system, you’ll need to plan and schedule your system installation soon.
How Much Can You Save with the Utah Solar Tax Credit?
As the policy currently stands, the Utah solar tax credit allows you to claim 25 percent of the total price of your photovoltaic equipment and installation. Take advantage of this perk, and you can save up to $1,600 on the cost of going solar.
But you’ll need to act fast. As the years go by, the maximum amount you can claim drops. If you wait too long, the opportunity to reduce your tax liability will be gone for good.
To see $1,600 in savings, you’ll need to install your photovoltaic system by the end of 2020. If you hold off until 2021, you can only claim $1,200. In 2022, the state-level tax credit is capped at just $800, and it goes down to $400 for systems installed in 2023. After that, the Utah solar incentive no longer exists.
Can You Still Claim the Federal Tax Credit for Going Solar?
Yes, you can claim both the Utah solar tax credit and the federal solar investment tax credit (ITC) – and you absolutely should.
The federal ITC offers major savings, as it lets you deduct 30 percent of your total photovoltaic equipment and installation costs from the amount of income tax you owe. The credit has no cap, so this can amount to thousands of dollars. Combined with the state-level incentive, you can reduce the costs of going solar by 50 percent or more.
To maximize your solar savings, however, you’ll need to install your photovoltaic system before the end of 2019. In 2020, you can only claim 26 percent of your costs, and in 2021 the amount drops to 22 percent. In 2022, the federal ITC is slated to be eliminated.
Are You Ready to Plan Your Photovoltaic System Installation?
Clearly, the phasedown of both the Utah solar incentive and the federal ITC means going solar sooner rather than later is in your best financial interest.
If you want to save the most money, start planning your Utah solar project now. The process can take a few months, and your system must be in operation by December 31, 2019 to qualify for the full 30 percent federal ITC.
When you’re ready to get started, contact an experienced, reputable local solar contractor – like PRVL Energy.
A locally-owned and operated Utah solar provider, PRVL Energy is one of the few SunPower Elite Dealers in the state. We install high-performance systems with the most efficient, reliable photovoltaic panels on the market. With us, you’ll enjoy much lower energy bills as well as big savings over the lifetime of your photovoltaic system.
And, PRVL Energy makes going solar easy – we’ll even handle the paperwork for the federal ITC and the Utah solar tax credit. For more information, or to schedule a complimentary consultation, contact us today.